Michael Oxley

Mr. OXLEY

Mr. OXLEY. Madam Chairman, I claim the time in opposition, although I am not opposed to the amendment. As a matter of fact, I am very much in favor of the amendment, and I congratulate the gentlewoman from California for her amendment. I know the gentleman from Delaware (Mr. Castle) and the gentleman from Michigan (Mr. Ehlers) and others on our side of the aisle have been very interested in this entire issue. I think it is a worthy amendment, and we have no objection on this side.

Mr. OXLEY. Madam Chairman, I move that the Committee do now rise.

Mr. OXLEY. Mr. Chairman, will the gentlewoman yield?

Mr. OXLEY. I look forward to working with the gentlewoman on that issue.

Mr. OXLEY. I look forward to clarifying this language with the help of the gentlewoman from Ohio.

Mr. OXLEY. Mr. Chairman, I yield 2 minutes to the gentleman from Ohio (Mr. Ney), the chairman of the housing subcommittee.

Mr. OXLEY. Mr. Chairman, I yield 1 minute to the gentleman from California (Mr. Gary G. Miller).

Mr. OXLEY. Mr. Chairman, I yield 2 minutes to the gentleman from Connecticut (Mr. Shays).

Mr. OXLEY. Mr. Chairman, I yield myself such time as I may consume. This has been an excellent debate, and we appreciate the efforts on both sides of the aisle for this legislation. Mr. Chairman, this is historic legislation, the first time that any Congress has reached a stage where we are debating a major reform effort for the GSEs. It is a long time coming. The gentleman from Louisiana (Mr. Baker) has toiled in the vineyards for all of these years, and we have finally reached a situation where we can finally pass legislation that will improve the regulatory structure of the GSEs, ultimately make them stronger and more accountable, provide affordable housing funds through the GSEs throughout the country and particularly related to the hurricane-affected areas. This is well balanced. It makes a lot of sense, something that we have been working on for a long time. And I know a lot of the debate has been about one particular part of the manager's amendment that I will be offering next, but at the end of the day, when this bill comes up for final passage, most Members will support it because it makes good sense from a regulatory standpoint, it makes good sense from an affordable housing standpoint. House of Representatives, Committee on Financial Services, Washington, DC, September 14, 2005. Hon. F. James Sensenbrenner, Jr., Chairman, Committee on the Judiciary, Rayburn House Office Building, Washington, DC. Dear Mr. Chairman: On July 14, 2005, the Committee on Financial Services filed its report on H.R. 1461, ``Federal Housing Finance Reform Act of 2005.'' The bill was then sequentially referred to the Committee on the Judiciary until September 16, 2005. I am writing to confirm our mutual understanding with respect to the further consideration of

Mr. OXLEY. Mr. Chairman, I yield back the balance of my time.

Mr. OXLEY. Mr. Chairman, I offer an amendment.

Mr. OXLEY. Mr. Chairman, I yield myself such time as I may consume. The manager's amendment that I offer makes a number of substantive and technical changes to H.R. 1461, the Federal Housing Finance Reform Act of 2005. H.R. 1461, as reported by the Committee on Financial Services, greatly expands the affordable housing role of Fannie and Freddie. There are major sections on new single-family and multifamily housing goals, duty to serve lower-income markets, and a new Affordable Housing Fund with contributions from the enterprises. The bill establishes a fund to finance construction of houses for underserved people. It is modeled after the successful Affordable Housing Program of the Federal Home Loan Bank System. Fannie Mae and Freddie Mac will manage programs funded by a percentage of their earnings. The manager's amendment moves the effective date of the entire bill up from 1 year to 6 months following enactment, including the affordable housing funds. For the first 2 years, Fannie and Freddie will contribute 3.5 percent of after-tax earnings and, subsequent to that, 5 percent of such earnings. Twenty-five percent of the GSEs' contributions will go annually to the Treasury Department to help pay off REFCorp, that is, S and L bonds, with the remainder going to the fund. The fund will sunset in 5 years, when its extension will be considered. During the first 2 years, priority consideration will be given to areas impacted by Hurricanes Katrina and Rita. Thereafter priority in funding will be based on greatest impact, geographic diversity, timely action, as well as other disaster area needs. Eligible recipients, for-profit builders, State housing agencies, and nonprofit organizations must have a demonstrated capacity for affordable housing activities and make assurances that they will comply with limits on the use of those funds. Funds may not be used for political activities, advocacy, lobbying, counseling services, travel expenses, and tax return advice. Nonprofit recipients must have affordable housing as their primary purpose, and beginning 1 year before applying, nonprofits and their affiliates cannot have engaged in Federal election activity, electioneering communication, or lobbying. Recipient use of funds will be closely tracked. Those misusing funds will be permanently barred from participation and must make reimbursement. In addition, the manager's amendment includes a request from the Committee on the Judiciary to require consultation with the Attorney General by the GSE regulator when exercising new litigation authority, and from the Committee on Government Reform to remove a Freedom of Information Act exemption for the proceedings of the new agency's oversight board. The Federal Housing Finance Agency will establish an ombudsman to hear complaints and appeals from the GSEs and those having business relationships with the GSEs. H.R. 1461 consolidates current GSE regulation by two agencies in HUD into one agency. The manager's amendment clarifies that existing rules and regulations will remain in force during the 6-month transition period and until changed by the new Federal Housing Finance Agency. I urge adoption of the manager's amendment. Mr. Chairman, I reserve the balance of my time.

Mr. OXLEY. Mr. Chairman, I am pleased to yield 4 minutes to the gentleman from Louisiana (Mr. Baker), chairman of the GSE subcommittee.

Mr. OXLEY. Mr. Chairman, I would simply say in summary to ask the Members to support the manager's amendment. We need to support the folks down in the gulf region that were affected by the hurricane. The purpose of the manager's amendment was twofold, to insure that money was available as quickly as possible to those victims who are 100,000 homeless, just in Louisiana alone, to make certain that they can get access to that as quickly as possible; secondly, to make certain that the groups that are building those homes are not political front groups for a right or left agenda, but ones who are sincerely interested in building with bricks and mortar to provide that opportunity to those folks. If you want to help those folks in the gulf region, and you want to make certain that money is used effectively and not in a political way, support the Oxley manager's amendment. Mr. Chairman, I yield back the balance of my time.

Mr. OXLEY. Mr. Chairman, I rise to claim the time in opposition to the amendment but am not opposed and would indicate that we are pleased to accept the amendment offered by the gentlewoman from Indiana and applaud her for her foresight and leadership in the area of manufactured housing.

Mr. OXLEY. Mr. Chairman, I rise to claim the time in opposition, but I also want to say I do not oppose this amendment. As a matter of fact, I want to congratulate the gentleman from Alabama for an excellent amendment and well thought-out. He is a valuable member of the committee. This side has no objections to the amendment.

Mr. OXLEY

Mr. OXLEY. Mr. Speaker, let me thank the gentleman from Texas (Mr. Sessions) for conducting a worthwhile debate on this issue and the rule. While we will have plenty of time to debate the merits of the legislation, and there are a great deal of those out there, and I think both sides would agree, I want to thank the gentleman from Louisiana (Mr. Baker) for his excellent work, as well as the gentleman from Massachusetts (Mr. Frank), the ranking member. The approach that we took, beginning with the need, the glaring need for a world-class regulator for the GSEs, became quite evident with the revelations of some of the accounting scandals that took place in both of those institutions and to a lesser extent with the Home Loan banks. Looking back in the past when Chairman Baker was a lone voice in trying to get changes in the regulatory structure to where we are now is quite extraordinary. It is quite extraordinary that we are actually debating a rule that would bring up a major piece of legislation totally changing the way we look at GSEs and their role in the housing market and the secondary market, particularly as it relates to their regulation and how they are regulated. I do not think anybody can argue that the structure we set up is less than superlative and provides a world-class regulator. Some of the issues we debated that were so contentious, I think of receivership, and all of the debates that we had about the necessity for including receivership language in it so in case one or both of the GSEs, that the regulator could actually put them in receivership, essentially became a nonissue just a few months ago. I think that points out the kind of progress we made in the committee. The 65-5 vote that we had on final passage was quite extraordinary. We also needed to look at the whole issue of affordable housing. The gentleman from Ohio (Mr. Ney) and his subcommittee really deserve a lot of credit for putting together, I think, a very solid plan borrowed from the Home Loan bank system from which they set aside 10 percent of their profits towards affordable housing. Let me point out that program has been incredibly successful over the years, borrowing a page from the Home Loan banks, in this case, to set aside 5 percent from Fannie Mae and Freddie Mac that would potentially provide hundreds of millions of dollars towards affordable housing. Again, I think Members agreed with that, and the concern was always, I think, in the back of everybody's mind to make certain that this money was accountable and it was used for bricks and mortar, actually building the homes instead of political advocacy and the like. Indeed, I think we came to a reasonable conclusion on that. We have differences as to the application of that. It was always our goal to make those funds available only to groups that had housing as a function and that they had a track record. I am thinking of Habitat for Humanity as a good example, but also State housing agencies and for- profit companies that would compete for those funds and would have to be approved by the board we set up in the legislation, again, providing accountability where that money goes because it is technically, certainly, not government funds, taxpayer funds, but private sector funds. We want to make certain that every dollar that was made available went into building affordable housing. And then, of course, along came Hurricane Katrina, Hurricane Rita, and now Wilma; and those events provided another glaring need for affordable housing in those heavily struck areas. That is why we wanted to include those and provide them with the opportunity to essentially be first in line for those funds because of the enormous complications that have developed down there in terms of housing and exacerbated an already difficult situation. That is where we are now. I am proud of the committee and the work we have been able to do. I think we are in a position where we can debate the manager's amendment under the rule. There are several Democrat amendments made in order, Republican amendments made in order, four on each side. I think the Rules Committee has done a superb job in doing that. I know the gentleman from Massachusetts will probably offer a motion to recommit based on the issue of fund availability. That is precisely within his rights, and I would expect that. But this vote on the rule that I support is moving us forward to get to legislation passing to help the hurricane victims and to better regulate the GSEs. I think there is a broad bipartisan consensus for that. Let us vote up the rule and get on with the debate.

Mr. OXLEY

Mr. OXLEY. Madam Chairman, I yield myself such time as I may consume. Madam Chairman, let me just say to my friend from Pennsylvania there are some sections of that amendment that I support in terms of independence. But I do have a problem with the Presidential appointees to the board. They are basically symbols of the tie between Fannie Mae, and Freddie Mac and the Federal Government, and really do speak to the implied guarantee out there for the GSEs. The gentleman indicated that he had bipartisan support. In fact, it failed on a tie vote in the committee. I will concede there was bipartisan support. There was also bipartisan opposition. But at the same time I think that President Bush, who has decided not to fill those vacancies on the board, is on the right track, and I think this amendment would simply add to the perception of the Federal guarantee. To that extent, I would oppose the amendment. Madam Chairman, I yield back the balance of my time.

Mr. OXLEY. Mr. Speaker, I rise in opposition to the motion to recommit.

Mr. OXLEY. Mr. Speaker, I never thought a debate on GSE reform would be so emotional, and it has been a long day and a very productive day and a good debate. Let me, first of all, say to my friend from Massachusetts, who worked very well with us in committee on this important legislation, let us not lose sight of the fact that this is the first major GSE reform bill to ever come before any Congress. It was well written and well received, and it does a lot to create a world-class regulator for the GSEs. Secondly, it creates for the first time a housing fund that will funnel millions and millions of dollars into affordable housing through the GSEs, and I think we do not want to lose sight of that. Thirdly, this legislation does not ban faith-based groups from providing housing. All it says is that we want groups that have had a record of building houses, a record of building houses in the various States, to be able to do that. We want to make certain that that money is used for housing, not for political activity, not for lobbying or everything else. Fourthly, let me add, the gentleman from Massachusetts (Mr. Frank) in his motion talks about a nonpartisan basis. There is no definition in the campaign laws that I can find that defines what is essentially nonpartisan, and I think we need to keep that in mind. Understand this effort is to try to get as much money into the areas, in particularly the first 2 years in the hurricane-related areas, so we can provide affordable housing. Those folks along the gulf coast that were affected, Florida, Alabama, Mississippi, Texas, need to understand that this is the best way to provide affordable housing as quickly as possible with the maximum amount of oversight in this area. Mr. Speaker, I yield to the gentleman from Louisiana (Mr. Baker), the sponsor of the legislation.

Mr. OXLEY. I yield to the gentleman from Massachusetts.

Mr. OXLEY

Mr. OXLEY. Mr. Speaker, I offer a resolution (H. Res. 513) and I ask unanimous consent for its immediate consideration.

Mr. OXLEY

Mr. OXLEY. Mr. Speaker, I was absent from the floor during yesterday's rollcall votes on House Resolution 457, recognizing National Chemistry Week, and House Resolution 491, supporting National Cyber Security Awareness Month. Had I been present, I would have voted in favor of both resolutions.

Mr. OXLEY

Mr. OXLEY. Madam Speaker, I rise in support of this legislation and commend the sponsor of the legislation, the gentleman from Louisiana (Mr. Baker), for his tireless work and dedication for providing housing relief for the victims of Hurricane Katrina and Hurricane Rita. Residents of the rural gulf region have been especially affected by the devastating impact of Hurricanes Katrina and Rita. While media attention in the aftermath of these catastrophes has been focused on the urban disaster, particularly New Orleans, rural communities in the region, and individuals and families who are assisted by rural housing service programs, face a challenging road. Rural areas are often plagued by poverty, high numbers of substandard homes, affordable housing shortages, costly development, and inadequate access to mortgage loans. RHS, through its programs, provides direct loans, guaranteed loans and grants to help families obtain and maintain affordable housing in those rural areas. Because so many rural families in the gulf region have left their communities, either because their housing is now in ruins or because they have settled in another community, it is extremely important that RHS has the flexibility to provide assistance to these families who have been displaced from rural gulf communities. The legislation we are considering today will enable RHS to continue to meet the needs of rural families who have been displaced by the hurricanes. This legislation will temporarily give RHS the necessary funding options it needs to keep families in the program in the wake of this disaster. In short, this important revision will give RHS the ability to convert to vouchers funds tied to a rural housing project that is no longer habitable due to the effects of Hurricane Katrina and Hurricane Rita. RHS will have the authority to reprogram funds in either HUD section 8 vouchers or RHS vouchers authorized under title V of the Housing Act of 1949. This legislation is designed to provide temporary housing relief for families affected by the hurricanes and upon enactment will be effective for 6 months. Next, H.R. 3895 will expand the flexibility of RHS by temporarily eliminating the current limitations regarding the number of vouchers that can be issued and where they can be used. Again, this is a temporary suspension, to be in effect for 6 months upon enactment, which reflects the need for timeliness and efficiency in securing housing for rural families under RHS programs. Finally, this legislation amends the single family housing guaranteed loan program by expanding refinancing to include loans for housing repair and rehabilitation. Currently, repair and rehabilitation costs cannot be financed from refinanced guaranteed loans. This legislation will also allow refinancing of loans from borrowers who are not currently in the USDA single family housing program. While these authority changes to the single-family housing program are not limited to disaster situations, they will be very helpful in assisting families affected by Hurricanes Katrina and Rita. H.R. 3895 will help ensure that housing assistance continues to be available to those of the neediest individuals and families in the rural gulf region, who have already suffered greatly in the aftermath of the hurricanes. I urge my colleagues to support this legislation, and, Madam Speaker, point out that the committee, once again, has worked effectively through these issues, these three suspension calendar votes, in anticipation, as the gentleman from Louisiana pointed out, and my friend from Massachusetts mentioned, with a goal of looking at a long- term solution to this problem that is one that will not go away and will be over a period of years, as the gentleman from Louisiana pointed out. I want to say to the members of the committee and to the House that this committee stands ready to do what is necessary to bring relief to those regions in a fiscally responsible manner. I have every reason to think we will do exactly that.

Mr. OXLEY

Mr. OXLEY. Mr. Speaker, today I rise in support of H.R. 3896, the Hurricane Katrina Emergency Relief CDBG Flexibility Act of 2005. This legislation would temporarily remove the public services cap on a locality's Community Development Block Grant, CDBG, funds and would waive the program's public hearing requirement for Hurricanes Katrina and Rita affected areas. In the aftermath of Hurricanes Katrina and Rita, the Federal and local governments now face the Herculean task of coordinating the relocation of thousands upon thousands of individuals and families whose lives have been torn apart by devastation and rising flood waters. This bill would allow communities affected by Hurricanes Katrina and Rita to receive grants under the CDBG program in an expedited fashion. First, temporarily removing the public services cap would give affected communities flexibility in applying grant funds to hurricane affected areas. Second, although the community participation provision is an important part of the CDBG program, it is not currently feasible for affected localities to hold a public hearing. In the interest of time, temporarily removing the public hearing requirement would allow funding to be dispersed more efficiently so that affected communities may begin the rebuilding process. In times like these, it is more important than ever for Americans to stand united in helping our fellow citizens. The House of Representatives will continue to stand with the people of the gulf coast throughout this effort, and we encourage Americans who want to help to contact charitable organizations in their area. America has overcome challenges in the past. As members of the House and specifically the Financial Services Committee, we are prepared to roll up our sleeves and do the hard work to overcome this tragedy. Giving communities easier access to their CDBG dollars is just one step in the process of helping those who have been affected by Katrina and Rita's waters. I would like to thank Housing Subcommittee Chairman Bob Ney for his expeditious work in sending this bill to the floor. I would also like to thank Chairman Richard Baker, Congressman Barney Frank, and Congresswoman Maxine Waters for their bipartisan support in moving this bill. I urge my colleagues to support this piece of legislation.